Sage 50 Insights: How To Pay In A Foreign Currency

Sage 50 Insights: How To Pay In A Foreign Currency

in Sage February 12, 2018

HI all and welcome to our latest Sage Insight Guide, our series of how to videos and articles designed by our support consultants to enhance your sage user experience.  For our first article of the month, we have prepared a brief guide into how you can use Sage to pay and receive currency to customers and suppliers outside of your base currency. By default, Sage 50 doesn't allow invoices to be paid or received outside of your base currency but with the use of Dummy Bank Accounts you can workaround this issue. To outline how this would work in Sage 50 we have included a couple of examples below to guide you through this process. 

Example 1

A supplier has invoiced you €30,000, which you wish to pay out of your U.S. Dollar account.

1. Check if you have a Dummy account, in the currency your supplier has invoiced. (In this example, it would be Euros). If you do, take a note of the account number. If you do not create one, making sure you name it Dummy Euro account (or whatever currency you need).

2. Make a supplier payment from the Dummy Euro account for the value of the invoice you wish to pay.

This will leave a negative balance in the Dummy Account for the value of the invoice.

3. Transfer the monies from the account you wish to pay the invoice for into the Dummy Account (in this example it’s the U.S. dollar account to the Dummy Euro Account) using the exchange rate provided by the bank when you made the actual payment.

This will then leave the Dummy Account with a Zero Balance

 

Example 2

You have invoiced a customer €30,000, which they have paid into your U.S. Dollar account.

1. Check if you have a Dummy account, in the currency you have invoiced your customer. (In this example, it would be Euros). If you do, take a note of the account number. If you do not create one, making sure you name it Dummy Euro account (or whatever currency you need)
2.   Process a customer receipt into the Dummy Euro account for the value of the invoice which has been paid.

 

This should leave a positive balance in the Dummy Account for the value of the invoice.

3. Transfer the monies from the Dummy account to account which the monies have actually been paid (in this example it’s the Dummy Euro account to the U.S. Dollar account) using the exchange rate provided by the customer when you made the actual payment.

This will then leave the Dummy Account with a Zero Balance

 

IMPORTANT: Dummy bank accounts should always have a Zero balance when transactions are complete. These accounts are only to be used a control account and should never have balance, as they are fictional accounts.

We hope you have found this article useful in enhancing your Sage expertise and please check back for more Sage Insight user guides and videos every Monday on our website.  All our articles are created based on real queries and support requests that we have received from our clients across all versions of Sage that we support including Sage 200, Sage 50, Sage Payroll and Sage Manufacturing.  

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